Release Date: February 20, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q: Could you elaborate on the potential desalination synergies with behind-the-meter power generation and data centers? How advanced are your discussions on this opportunity? A: Robert Crain, EVP of Texas Pacific Water Resources, explained that the Permian Basin's power constraints present a transformational opportunity for data centers. The synergies include waste heat capture from power generation for desalination and addressing water demand with produced water. These elements together create a significant opportunity.
Q: Is the goal still 75% volume reclamation, 75% analyte removal at a cost of 75 cents per barrel for desalination? How confident are you in achieving this with a commercial scale facility? A: Robert Crain confirmed they are on track for the 75% targets. The main cost driver is energy consumption, and they are exploring natural gas generation to reduce costs. They are trending towards achieving all three targets.
Q: Where are you seeing the greatest opportunities today between royalties and surface assets? A: Tyler Glover, CEO, stated that the deal pipeline looks promising for 2025, with opportunities in both surface and mineral assets. They anticipate high-quality acquisition opportunities across surface, mineral, and water spaces.
Q: Could the Trump administration make any federal changes in policy that could open up more pore space in New Mexico? A: Tyler Glover mentioned that while it's possible, they are not aware of any regulatory changes that would impact New Mexico's disposal regulations. Robert Crain added that any changes would likely be at the state level rather than federal.
Q: How are you thinking about the turn-in-line quarterly run rate for oil and gas royalties in 2025? A: Chris Steddum, CFO, indicated that based on current inventory, they expect a robust number of wells to come online in 2025. This could potentially exceed past years' run rates, depending on oil prices and activity levels.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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